Canadian regulators will oversee hiring of senior bank executives

20 May 2014

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Canadian regulators will oversee hiring of senior bank executives

A Reuters suggests Canada's financial regulator will have greater input into the hiring of senior management at Canada's banks and insurers.
Mew guidelines issued by the Office of the Superintendent of Financial Institutions (OSFI) will require financial institutions to notify the regulator in advance of potential senior executive hires or director candidates.
"To the extent that OSFI may have any specific concerns or comments regarding the appropriateness of a candidate, OSFI will inform the board of the financial institution prior to the candidate's appointment or nomination for election," according to the regulator.
Regulators insiste final hiring decisions will be in the bank's hands, but according to the guidelines OFSI may also request a meeting with new executives shortly after they start the new job.
The latest guidelines re-write rules first proposed in January that would have required institutions provide 30 days-notice before any senior hire and required banks to state reasons for a candidate's selection. As such, the new guidelines are considered a loosening of the earlier proposed regulations.
The new rules are part of an ongoing overhaul of bank regulations that has regulators tightening capital and liquidity restrictions on banks and insurance companies, while applying stricter rules on mortgage lending.